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Commission’s EU Cohesion Policy: helping SMEs produce growth

Eugene Eteris, European Studies Faculty , RSU, Riga, 19.04.2013.

Commission published EU Cohesion Policy which shows how the EU funds are assisting the member states and SMEs to weather the crisis and produce growth. The Commission 2013 Strategic Report is an overview of the EU Structural Funds performance in the 27 member states. For example, about 53 thousand R&D projects and 16,000 business-research projects received investment from these funds.

Through three European funds – the European Regional Development Fund (ERDF), the European Social Fund (ESF), and the Cohesion Fund the European institutions are investing into the EU cohesion policy €347 billion in 2007-2013 in the 27 member states’ development; this represents 35% of the total EU budget for this multi-annual period (€975 billion).

The Report also underlines the relevance of the profound reforms currently being negotiated between the European Parliament and the member states’ governments for cohesion policy from 2014-2020, including a more strategic concentration of resources on key priorities and more focus on results and evaluation.

The Report’s review

The “Strategic Report” outlines the progress of each country on delivering EU objectives, in line with the targets of the EU-2020 Strategy. It encourages Member States to measure progress in key strategic sectors, such as research and innovation, rail, energy, capacity building, sustainable urban transport, job creation and training.

The reports submitted by the 27 Member States at the end of 2012 (based mainly on 2011 data) provide the Commission with the first opportunity to report, during a programming period, on progress in delivering outputs and results and to highlight important and timely messages on the potential of Cohesion Policy to play its part in the EU's economic recovery.

The Commission identifies the investment areas where action must be taken to speed up the selection and execution of projects co-financed in 2007-13.

European Commission, Press release, IP/13/336; Brussels, 18 April 2013.

Progress in cohesion policy

The European Commission has presented (Brussels, 18 April 2013) an overview of the EU Structural Funds performance in the 27 member states. The ‘Strategic Report’ on the implementation of 2007-13 Cohesion Policy programs pulls together available information from the EU states, up to end-2011 in most cases.

With 4 more years to go until the programs finish in 2015, investments under the European Regional Development Fund, Cohesion Fund and European Social Fund have already led to progress and improvement for many citizens.

Progressive investments across the EU-27 include the following achievements:

- 1.9 million more people now have broadband access;

- 2.6 million more people are served by water supply, 5.7 million more by waste water projects;

- there are 460 km of TEN-T roads and 334 km of TEN-T rail; and

- 2.4 million people assisted by the European Social Fund found a new job.

Innovation and small business are receiving a huge boost from cohesion policy investments with many more in the pipeline. So far:

- 53,240 R&D projects and 16,000 business-research projects received investment, and

·-53,160 start-ups have been supported.

As funds are utilised and projects get off the ground, the report documents:

- a significant increase in the number of people supported in the area of employment from around 10 million annually before 2010 to some 15 million on an annual basis since then; and

- a significant acceleration of results since 2010 in the area of support for SMEs: Almost 400,000 jobs created (half of these in 2010/11) including 15,600 research jobs and 167,000 jobs in SMEs.

Commission’s opinion

Commenting on the report, two Commissioners expressed their views on cohesion policy and its role for the member states’ development.

Thus, Regional Policy Commissioner Johannes Hahn said: "This report provides an invaluable snapshot of a policy that is delivering across most of the EU’s priorities and investing in growth when it is most desperately needed. We are providing support to new innovative business and creating good sustainable jobs for the future, giving remote regions broadband, tackling the brain drain, and building vital transport links that contribute to regions' competitiveness. The policy has also shown itself capable of great flexibility, responding to the crisis and adapting to the changing needs of people and their communities."

He added: "But we also have lessons to learn: results are sometimes patchy and Member States need to speed up their efforts to use the EU resources. As we look ahead to the new programming period, we expect Member States and regions to focus the policy even more on results and priorities that will have the greatest impact."

Commissioner for Employment, Social Affairs and Inclusion Lázsló Andor added, "With the crisis, EU cohesion policy funds have become even more important as a source of investment across the Union. The European Social Fund is delivering crucial support to our human capital, especially helping young people to maximise their chances of a successful career. The preparation of the next generation of programs is a unique opportunity to underpin our growth and jobs strategy with significant financial support. Social and human capital investment needs to play an important role in this."

Reference: IP/13/336; 18.04.2013;